Straight from the Specialists
(Any opinions expressed here are those of the author and not of Thomson Reuters)
The New Year was ushered in with a steep and sudden correction in the broader indexes, with the Nifty closing 1.63 percent lower at 6,211. However, the mid-cap and small-cap indexes outperformed.
Though the holiday mood was evident, it was a politically charged week. The newly installed Aam Aadmi Party (AAP) government in Delhi won a confidence motion with the support of the Congress. They subsequently announced power subsidies after granting water sops last week. Prime Minister Manmohan Singh addressed a rare press conference, the third in 10 years, announcing his intent of handing over the baton to a new prime minister.
Though Singh’s press conference did not have any anything for the markets to react, the media space grabbed by the AAP and its rising momentum is forcing market analysts to take stock. A slew of India Inc executives, such as former Infosys CFO V. Balakrishnan, have joined the AAP in the past few days, improving its credibility. The campaign of Narendra Modi, the Bharatiya Janata Party’s (BJP) prime ministerial candidate, could hit a road bump due to the new party’s increased appeal.
Markets had been betting on a BJP-led government and are again getting worried about a fractured mandate. The first 100 days of the Delhi government would be crucial for the AAP to prove their administrative capabilities but unfortunately for them, this period before the general elections would also be critical to reach out to the electorate across the country.
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The Life Insurance Corporation of India (LIC) has again come to the rescue of the industry in the financial year ending July 2012. While 23 private players together have a marginal dip in business (-1 pct), LIC has powered ahead with 23 pct growth in new business premium collection.